Sources and publications

The CFA Institute report highlights that gamification in investment apps—using game-like elements such as points, badges, leaderboards, and copy trading—can significantly increase user engagement and financial literacy, especially among younger investors. However, it also carries risks, as it may encourage impulsive trading, short-term strategies, and the exploitation of behavioral triggers for firm profit at the expense of investors. Ethical design, transparent rewards, and clear risk disclosures are essential to ensure gamification benefits users without causing financial harm.

The study explores how social media influences Bitcoin adoption, emphasizing responsible engagement. It finds that social media can effectively increase awareness and understanding of cryptocurrencies, but responsible adoption requires managing both internal risks (such as impulsive decisions, emotional biases, or overconfidence) and external risks (misinformation, scams, market volatility). When these risks are not properly managed, investing in crypto can lead to substantial financial losses or even psychologically harmful behavior. The authors stress that promoting literacy, credible information sources, and transparent guidance on social media is crucial to support informed, responsible cryptocurrency adoption.

The 2024 Frontiers in Psychology article “Basic human values and the adoption of cryptocurrency” examined 714 German adults to understand how personal values shape crypto adoption. The study found that openness-to-change values (curiosity, independence) predict awareness, while self-enhancement values (ambition, power) drive intention and ownership. Positive attitudes and perceived understanding of crypto increased adoption, whereas negative beliefs had no effect. Overall, adoption reflects empowerment and financial ambition rather than curiosity.

The OECD stresses the urgent need to improve digital financial literacy among crypto-asset users, as many lack the knowledge and skills to navigate the market safely. It recommends comprehensive education focused on risk awareness, scam prevention, and responsible behaviour, supported by collaboration between regulators, industry, and educators. Strengthening literacy, the OECD concludes, is key to fostering a safer and more responsible crypto environment.

The U.S. Securities and Exchange Commission (SEC) study, The Financial Illiteracy and Overconfidence of Margin Traders, found that investors who trade on margin tend to have lower financial literacy and a weaker understanding of margin mechanics than investors who do not use margin. Despite this knowledge gap, margin traders exhibit higher risk tolerance and greater confidence in their investment abilities. Notably, only 15% of margin traders correctly answered a basic margin-related question, compared with 31% of non-margin traders. The study suggests that overconfidence may be a key factor driving less financially literate investors toward leveraged investing strategies, highlighting the potential risks associated with margin trading.